COSATU's comments on SoNA 2014

The Congress of South African Trade Unions congratulates President Zuma on his State of the Nation Address. We echo his tribute to the magnificent achievements of successive ANC-led governments in our first 20 years as a democratic nation.

Who could possibly argue with his assertion that "South Africa is a much better place to live in now than it has ever been"? The workers of South Africa will never forget how much we have achieved:

Strong institutions of democracy.

A unitary, non-racial, non-sexist democratic state.

A thriving constitutional democracy.

Chapter 9 institutions which support democracy and protect the rights of citizens.

Labour laws which protect workers from abuse and super-exploitation.

An active civil society and a free media.

COSATU totally agrees with the President however that we cannot afford any complacency and that "our country still faces the triple challenge of poverty, inequality and unemployment".

In particular, the urgent task we face is the implementation of what the ANC 2012 Conference called the Second Phase of the Democratic Transition. The task now is to achieve the same advances which we have made on the political front on the economic front, which has changed far too little since 1994.

Ownership of the country's wealth and resources is still concentrated in the hands of a small, mainly white, male elite, who run big monopoly companies, many foreign-owned. Inequality between that elite and the workers whose toil creates the wealth they enjoy is getting wider and wider.

Poverty and inequality lie at the heart of all the strikes and community protests which we have seen recently. COSATU fully backs the President's plea for protests and strikes to be conducted lawfully and peacefully. We welcome the criticism of the Police conduct during strikes and the continued unnecessary loss of lives

We note however his off-the-cuff announcement of "regulations to prevent arbitrary strikes and retrenchments" and urge him to clarify what he means and to reassure us that any such regulations will be fully discussed by role-players.

The long-term solution to strikes and protests lies not just in regulations and police action but through the transformation of our economy and the creation of thousands of decent, sustainable jobs, decent wages and a far more equitable distribution of the country's wealth.

For that reason COSATU was concerned that very few of the President's proposals were new, but repetition of many pledges already made in previous SONAs and there was not enough focus on the way forward.

The federation has consistently backed such policies as the Industrial Policy Action Plan, the Infrastructure Development Programme and at least parts of the New Growth Path. We appreciate the progress Comrade Zuma was able to report on these areas, including that:

Jobs are now being created again. According to Stats SA, there are now 15 million people with jobs in the country, the highest ever in our history, and over 650 thousand jobs were created last year.

In the next five years, the state will procure at least 75% of its goods and services from South African producers.

The Rea Vaya system in Johannesburg is now used by more than 100 000 Gauteng residents and similar systems are being built in other cities.

Harbours and ports have been improved and we have built a 700 kilometre fuel pipeline from Durban to Johannesburg.

Close to 1500 kilometres of new roads or lanes have been built.

But as the President himself said "This is still not good enough. The unemployment rate still remains high." While these are important areas of progress, which we welcome, we also need to be brutally frank about the challenges we face. We must avoid being triumphalist or claiming easy victories.

It is also worrying that the economics of the National Development Plan (NDP) are still being highlighted as a solution to our socio-economic challenges. The NDPs market-led solutions if implemented will roll back many of the areas of progress spoken about in SONA, which have been made through state-driven interventions.

COSATU reiterates its call for serious engagement to reshape the economic elements of the NDP, as agreed at the 2013 Alliance Summit, in line with the resolution for radical economic transformation.

On youth unemployment, the President expressed concern, but the federation is concerned that the government is still relying on the Employment Tax Incentive Act to encourage employers with big tax rebates to employ younger workers.

We do not believe that this DA-inspired policy will do anything to create new jobs and that the regulations that are to be passed will in fact ensure that this does not affect unsubsidized or older workers adversely.

COSATU is concerned that although the president made a passing reference to measures are "contained in the National Youth Accord that was signed in Soweto last April" - he is referring to the Youth Employment Accord - there was no detail as to how its excellent proposals are to be rolled out, apart from the already agreed commitment to target "6 million work opportunities from this year to 2019, targeting the youth".

On inequality, the federation regrets that the President did not say more about the  National Minimum Wage, which was agreed in principle in the ANC Election Manifesto. This is the best possible way to both start narrowing the huge and growing income back between rich and poor and also to create more demand in the economy for goods and services, which will create many more jobs.

This kind of virtuous circle was at the heart of former President Lula's success in Brazil, where higher minimum wages and social grants let to faster growth, slower inflation and higher employment levels. We urge the president to move quickly to implement this policy.

COSATU welcomes the President's report of progress in the improvement in education and healthcare services.

We welcome the improved 2013 matric results (78, 2%) and congratulate the 439 572 students who passed. We cannot however ignore the appalling statistic that of the 1.1 million who enrolled in Grade 2 in 2003, only 562 000 reached Matric level in 2013. We must not overlook the challenges facing the other 538 000.

Our big challenge, which the Basic Education Accord deals with, is how to keep them in school until to Grade 12 and equip them with the skills and qualifications which they, and society, need.

COSATU calls for free higher education towards the four year degree or equivalent. We should welcome the R9 billion NSFAS increase but call a further fund increase to accommodate free education.

The National Health Insurance scheme is one of the government's finest initiatives, which should now be starting to roll out so we can build the foundations of a universal healthcare service which is delivered regardless of people's income.

COSATU welcomes the progress announced on the fight against corruption and the decision to establish a central tender board to adjudicate tenders in all spheres of government, in order to prevent corruption in the supply chain system, by checking on pricing and adherence to procedures as well as fairness.

We also agree with the deployment of financial skills in local authorities to mitigate the continued poor management.

We are however concerned that the equally serious problem in the private sector was only mentioned in passing, with a reference to the competition authorities investigating "large-scale price fixing in the construction industry" by guilty companies which were fined R1.4 billion. We need to see much greater priority by government to tackle this ongoing pillaging of our resources by private capitalists.

COSATU reaffirms is commitment to support the ANC in the national and provincial elections on 7 May 2014. Our members are already fully involved in campaigning for another overwhelming victory for their allies.

Statement issued by COSATU, February 15 2014

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